FHA mortgage loan approval with 4 1/2 year old unpaid auto repo

[Anonymous]

I have a 4 1/2 year old auto charge off for a repo that is not paid. Are there any lenders that will approve me for an FHA mortgage without paying this off. My scores are 674 and 678. Now have good job and have re-established credit.  Some boards say pay settlement. Others say don't.

Also, if I pay a settlement will this lower my FICO Score?

Thanks for any help you can give me.

[RAISEUP]

Would advise only to pay for deletion, not pay for settlement.

[Anonymous]

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@Anonymous wrote:

I have a 4 1/2 year old auto charge off for a repo that is not paid. Are there any lenders that will approve me for an FHA mortgage without paying this off. My scores are 674 and 678. Now have good job and have re-established credit.  Some boards say pay settlement. Others say don't.

Also, if I pay a settlement will this lower my FICO Score?

Thanks for any help you can give me.

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Fha does not require you to pay it off but lenders are adding their own rules to the fha rules.  You should be able to find a lender that won't have you pay it off.  If the lenders makes you pay it then you can either do a pay for delete like suggested or agree to pay for it at closing. 

[WannaHouse]

DON"T touch it unless the loan officer tells you to. It will update as current, and it will mess up your scores. Go ahead and get your pre-approved stuff out of the way, find the lender you want to deal with, and let them tell you anything that needs to be fixed.

[Anonymous]

I spoke to one mortgage guy and he said one bank would approve me if I set up payment plan with auto company.

But if I contact them( the auto co) doesn't this update the account and lower my fico score.

Does anyone know of any company that might approve a mortgage with unpaid repo on credit report?

I live in Mass.

Thanks again.

[anca21bi]

I have an unpaid repo from 2005, when I went to apply for a mortgage the broker told me to dispute the item since it was no longer reporting but just on my credit reports. So I gave it a try and next thing you know I get a letter from the 3 bureaus showing they deleted it. The original credit union show it listed but now reveals a $0 balance.

I had to give it a try my lender wanted $5000 or less in collections and the repo alone was over $4000.

[WannaHouse]

Is this repo listed as a judgement? If so, then it HAS to be paid. Check out the forum for rebuilding your credit to make sure you do it correctly.

[Anonymous]

although it is a large amount  $20,000 (which I can't see how it can be that much. the care was only $26000. So I feel the amount is wrong) But not a judgement. It is listed as a charge off.

[Anonymous]

Question? What is the difference from no;pnger reporting and just being on your credit report?

Thanks for all your replies.

Again, any help is appreciated.

[Anonymous]

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@Anonymous wrote:

I have a 4 1/2 year old auto charge off for a repo that is not paid. Are there any lenders that will approve me for an FHA mortgage without paying this off. My scores are 674 and 678. Now have good job and have re-established credit.  Some boards say pay settlement. Others say don't.

Also, if I pay a settlement will this lower my FICO Score?

Thanks for any help you can give me.

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I hate to say it, but if it's still within your state's Statute of Limitations, almost all lenders will say you probably have to pay it prior to closing.

Why? Because as it is, it represents a possible lien or judgment against you -- and therefore, against your home, which compromises your lender's interest in the property. That is, if you don't have homestead exemptions in your state.

I'm not 100% sure though -- I'd ask your LO about the WHY of why they say you need the payment plan. I've not had my morning ration of caffeine yet, so I can't be sure. I'll have a few cuppas and see what the average state law says in terms of judgments and possible "liens" against real property and be back in a bit.

Meanwhile, don't stress too much -- there's always ways to get around things (for'xample, the payment plan your LO suggested -- I'm NOT suggesting any illegal corner cutting!!).